Author: Michelin

Amid frequent interactions with Musk and publicly pointing out the need to change the current pace of car production and establish Trinity factory to compete with Gigafactory…

Among the many traditional vehicle enterprises that uphold strategic transformation, Diess, CEO of Volkswagen Group, is considered a radical. The Volkswagen Group led by him can be described as the most aggressive among traditional vehicle enterprises in response to electrification and digital transformation.

In 2021, Volkswagen released its NEW AUTO strategy for 2030, proposing three major platforms for the future: the SSP platform, the CARIAD software platform, and the electrification platform. For Volkswagen, which has a strong foundation in car manufacturing, if the hardware capabilities and the three-electric capabilities still need to be accumulated to a certain extent, software is undoubtedly the part that Volkswagen urgently needs to catch up with. Therefore, CARIAD has naturally become the most important piece of the puzzle in Volkswagen’s strategic transformation.

From the formal establishment of Volkswagen’s software business unit Car.Software Organisation in 2020 to Diess personally taking charge of the software department CARIAD at the beginning of 2022, to the establishment of CARIAD’s Chinese subsidiary on April 28th, CARIAD can be said to be accelerating its progress to catch up with this important software link.

A new era always comes with some new “gems of wisdom,” and in the era of smart cars, this “gem of wisdom” may be “software-defined cars.” Intelligence makes cars into robots with four wheels, and software becomes the key to creating differentiation among cars. From this perspective, mastering software may mean also mastering the “definition” of cars, right?

When Software Takes Center Stage in Volkswagen

On April 28th, CARIAD China was established, becoming the first subsidiary of Volkswagen’s CARIAD software company outside of Europe. The two protagonists of this event are software and the Chinese market.

In the past hundred years, the automotive industry has always been a world of machinery and hardware. As software, algorithms, and artificial intelligence gradually surround smart cars, software is gradually taking center stage in the automotive industry. For Volkswagen, this is both a change in demand and a change in business models. At the previous NEW AUTO strategy conference, Volkswagen announced that software, along with fuel vehicles and electric vehicles, will become the company’s main source of cash flow. Even by 2030, this latecomer software will surpass the other two parts and become the most important source of cash support.CARIAD has integrated developers, engineers, and designers from several software departments under Volkswagen Group to work towards a common goal. They are dedicated to developing a unified software platform and technology stack, enabling popular car brands such as Volkswagen, Audi, and Porsche to consistently attract customers with fresh digital experiences.

CARIAD currently has a team of approximately 5000 software developers, engineers, and designers worldwide. Their mission is to transform Volkswagen into a truly software-driven car company. CARIAD aims to increase the proportion of internally developed software to 60% by 2025.

By 2025, CARIAD will develop a software platform and next-generation end-to-end electronic architecture software stack 2.0. This will be responsible for upgrading the software of the electric platform MEB, the in-car operating system VW.OS, and L4-level autonomous driving technology. CARIAD’s Chinese subsidiary will also collaborate with its European headquarters to develop a unified and scalable software platform applicable to all group brands to meet specific market demands.

People often believe that for traditional car companies, hardware is their strong suit, and software is weak. However, for a highly integrated and standardized industrial product like a car, software and hardware can be said to be interdependent. Just as we cannot simply copy smartphone software onto a car, automotive software cannot exist independently of hardware. Therefore, it is crucial to integrate software and hardware to maximize software capabilities on a stable and reliable hardware basis.

To achieve this, CARIAD does not exclude improving its software capabilities through collaboration. For example, CARIAD has partnered with Microsoft to establish the Volkswagen Automotive Cloud and is collaborating in developing an autonomous driving platform to provide a development framework for complex autonomous driving functions. Just a week after the debut of CARIAD China, CARIAD announced a partnership with Qualcomm to provide system-level chips (SoC) for CARIAD’s software platform, aiming to achieve ADAS and L4-level autonomous driving functions. This close relationship also enables CARIAD to customize on a hardware basis.

When China Becomes the Arena of Smart CarsFrom Qualcomm chips to LiDAR, from short videos on board to in-car KTV, at some point the Chinese market has become the most important arena for smart cars, where innovative and intelligent products are first showcased. As the tide rises, Chinese demands for innovation and adaptability have also become higher.

The traditional approach where a product is launched overseas first and then localized for the Chinese market clearly cannot meet the needs of Chinese consumers. Therefore, setting up software development centers in China and integrating software talents to design products that cater to Chinese consumers during the prototype phase together with their headquarters, is becoming more and more necessary. This approach could shorten product launch time and tailor product functionality more closely to the needs of the domestic market.

“How many months could this approach save for product development? Halving the planning time.” said Dr. Wei Sun, CTO of CARIAD China. As intelligent vehicles enter into the era of fast development, this responsive capability enables car corporations to strike a balance between structured and flexible systems.

For a software company, software talent is undoubtedly a direct embodiment of research and development capabilities. Currently, CARIAD has over 600 employees in China and expects to double its number by the end of 2023, with over 90% being local software talent. Meanwhile, CARIAD is gradually building a nationwide distributed research and development network by establishing research and development teams in Beijing, Shanghai, Chengdu and Hefei. While hiring talents, CARIAD China is committed to completing the research and development tasks for three major platforms by 2025:

First of all, the mass-produced software platform MEB, where the Chinese team will lead the OTA for the Chinese ID. family, with the first update expected to launch in the second half of this year.

同时，应用于奥迪、保时捷高端型软件平台 PPE，将支撑基于安卓开源系统的先进信息娱乐系统以及高级驾驶辅助系统，中国团队正主导开发这两大系统的中国特定应用；到 2025 年，大众还将推出适用于旗下全部品牌的统一软件平台，可以支撑大众自主研发的操作系统 VW.OS。

In addition, the high-end software platform PPE used for Audi and Porsche will support advanced information entertainment systems and advanced driving assistance systems based on the Android open source system, and the Chinese team is leading the development of China-specific applications for these two systems. By 2025, Volkswagen will also launch a unified software platform that supports the company’s independently developed operating system, VW.OS, for all its brands.

Final WordsAt the CARIAD China press conference, we saw the launch of a self-developed software by the Chinese team – Rainbow Composer. When the user enters the car, all the digital elements in the car will be intelligently matched according to the user’s outfit, such as adjusting the desktop theme of the central control screen, ambient light colors, greetings, music elements, etc., making the cabin part of the user’s “OOTD (Outfit of the Day)”.

It sounds like an SOA feature opened by clothing, similar to the automatic switching of the phone theme, but seemingly only adding a bit of fun to the cabin. However, behind the implementation of the Rainbow Composer feature is the demand for a finely-grained and loosely-coupled automotive service architecture. It needs to modularize the software’s smallest unit to enable independent and compatible calls among various subsystems. This provides a feasible underlying architecture and imagination space for further creating different cabin scenarios and functions.

Using software to create more imagination space for cars may be the “definition right” of smart cars.

This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.